Spyro is probably the most requested character for these fights which is really surprising to me. I didn't think he had the following and, though I've never played a Spyro game, I decided to give it a shot and please the fans.

I always try to make these seem like even fights but, in this case, once I settled on the "biting off the arm" bit, I couldn't find an action that Mario could be performing that could make the fight seem like it could go either way. Also, because I never played any of those games (and despite me watching a replay of the first level of some Spyro game on YouTube) I had no idea what to put for a background. I went with "generic mountains" and gave it an orange-purplish palette to make it look more like a fantasy setting.

Fire flower requires use of hands, disabling him from doing anything else with them as well. It also only shoots in short bursts, whereas Spyro has a continuous stream and a multitude of other breath weapons.

As for the wing cap, if Spyro could simply dislodge Mario's hat, Mario would lose the ability to fly. Sure, Mario could always try to take out Spyro's wings, but any way he tries to approach Spyro he must contend either with his tail or horns. Mario's powerups also disappear when hit, so if Spyro manages to hit him even once he would revert. Of course, depending on which game this particular Mario is hailing from, the last point could be moot.

Spyro still has many breath weapons that he can switch between instantaneously. Mario needs to summon or find his powerups and even then there is a decent-sized window for Spyro to attack, putting Mario at a disadvantage.

As for the Roc Cape, while it can put him up and keep him suspended for lengthy periods (undoubtedly catching Spyro off-guard at first) he must land much sooner than Spyro would need to. And apart from the bombs, Spyro's attacks are not true projectiles, rendering the capes deflecting function useless.

And depending on whether this is Classic Spyro or Legends Spyro, he may have the potential to literally destroy the world, going by what Malefor said. Of course this argument could easily be rendered moot by the fact that Malefor, as the antagonist, is a less-than-reputable source. Legends Spyro is definitely special, though, with at LEAST Link-type power and strength when compared to other dragons.

Well, sure. If we ignore all of cannon and decide that Mario just has all powers of COURSE he would win. But there's no fun in that. The fun comes from comparing what they can and can't do, and deciding who is more likely to win. It's a bit like gambling. If you suddenly say that no matter what this machine will always win, then it's not fun. It's just pointless.